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| PRIOR PRINTER'S NOS. 1518, 1666, 1823 | PRINTER'S NO. 1837 |
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| THE GENERAL ASSEMBLY OF PENNSYLVANIA |
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| SENATE BILL |
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| INTRODUCED BY PILEGGI, TOMLINSON, BROWNE, ERICKSON, STACK, FONTANA, GREENLEAF, FARNESE, RAFFERTY, WAUGH, COSTA, MENSCH, BOSCOLA, SOLOBAY, BLAKE AND FERLO, SEPTEMBER 7, 2011 |
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| AS AMENDED ON THIRD CONSIDERATION, DECEMBER 6, 2011 |
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| AN ACT |
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1 | Amending the act of October 6, 1998 (P.L.705, No.92), entitled, |
2 | as amended, "An act providing for the creation of keystone |
3 | opportunity zones and keystone opportunity expansion zones to |
4 | foster economic opportunities in this Commonwealth, to |
5 | facilitate economic development, stimulate industrial, |
6 | commercial and residential improvements and prevent physical |
7 | and infrastructure deterioration of geographic areas within |
8 | this Commonwealth; authorizing expenditures; providing tax |
9 | exemptions, tax deductions, tax abatements and tax credits; |
10 | creating additional obligations of the Commonwealth and local |
11 | governmental units; and prescribing powers and duties of |
12 | certain State and local departments, agencies and officials," |
13 | in keystone opportunity zones, further providing for |
14 | extension for unoccupied parcels and for additional expansion |
15 | zones; providing for expansion for new job creation; and | <-- |
16 | further providing for application, for corporate net income | <-- |
17 | tax and for capital stock franchise tax; and, in tax | <-- |
18 | administration, further providing for application time; and |
19 | providing for monitoring data. |
20 | The General Assembly of the Commonwealth of Pennsylvania |
21 | hereby enacts as follows: |
22 | Section 1. Sections 301.3 and 301.4 of the act of October 6, |
23 | 1998 (P.L.705, No.92), known as the Keystone Opportunity Zone, |
24 | Keystone Opportunity Expansion Zone and Keystone Opportunity |
25 | Improvement Zone Act, added July 10, 2008 (P.L.1014, No.79), are |
26 | amended to read: |
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1 | Section 301.3. Extension for unoccupied parcels. |
2 | (a) Extension.--The department may approve an application to |
3 | extend the exemptions, deductions, abatements and credits under |
4 | this act as follows: |
5 | (1) One of the following: |
6 | (i) For a parcel in a keystone opportunity zone, |
7 | keystone opportunity expansion zone or keystone |
8 | opportunity improvement zone that is an unoccupied parcel |
9 | on the effective date of this section, for a period of |
10 | seven years from the expiration date of the zone. |
11 | (ii) For a parcel in a keystone opportunity zone or |
12 | keystone opportunity expansion zone that is an unoccupied |
13 | parcel on the effective date of this section, for a |
14 | period of ten years from the date of occupancy, provided |
15 | that the parcel is occupied on or before December 31, |
16 | 2015. |
17 | (iii) For a parcel in a keystone opportunity zone, |
18 | keystone opportunity expansion zone or keystone |
19 | opportunity improvement zone or subzone that expires in |
20 | 2013 or any year thereafter, for an additional period of |
21 | ten years from the date of occupancy. For a zone that |
22 | expires in 2013, the extension shall apply to parcels |
23 | that are unoccupied on the effective date of this |
24 | subparagraph. For a zone that expires after 2013, the |
25 | extension shall apply to parcels that are unoccupied on a |
26 | date determined by the department. |
27 | (2) The extension of exemptions, deductions, abatements |
28 | or credits authorized under this section, except exemptions |
29 | for sales and use tax under section 511(a) or 705(a), shall |
30 | take effect only upon occupancy. |
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1 | (b) Real estate tax abatement.--The owner of an unoccupied |
2 | parcel in a keystone opportunity zone, keystone opportunity |
3 | expansion zone or keystone opportunity improvement zone that has |
4 | expired but that receives an extension of tax abatement |
5 | eligibility following the original expiration date of the |
6 | keystone opportunity zone, keystone opportunity expansion zone |
7 | or keystone opportunity improvement zone under subsection (a) |
8 | shall not receive an abatement of real property tax until the |
9 | parcel becomes occupied or developed. |
10 | (c) Application.--Except as provided in subsection (d), in |
11 | order to extend the tax benefits for unoccupied parcels under |
12 | subsection (a), the department must receive an application from |
13 | a political subdivision or its designee no later than June 30, |
14 | 2009. The application must contain the information required |
15 | under section 302(a)(1), (2), (3), (5) and (6). The application |
16 | must include all ordinances, resolutions or other required |
17 | action adopted by all political subdivisions in which the |
18 | unoccupied parcel is located adopting the extension of all tax |
19 | exemptions, deductions, abatements and credits authorized under |
20 | Chapter 7. The department, in consultation with the Department |
21 | of Revenue, shall review the application and, if approved, issue |
22 | a certification of all tax exemptions, deductions, abatements or |
23 | credits under this part for the unoccupied parcel within three |
24 | months of receipt of the application. The certification shall be |
25 | effective on the day following the expiration date of the |
26 | existing subzone. For a keystone opportunity zone, keystone |
27 | opportunity expansion zone or keystone opportunity improvement |
28 | zone or subzone that expires in 2013 or any year thereafter, in |
29 | order to extend the tax benefits under subsection (a)(1)(iii), |
30 | the department must receive an application no later than three |
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1 | months prior to the expiration date of the zone. |
2 | (d) Applications for certain zones.--For a keystone |
3 | opportunity zone that expires December 31, 2008, an application |
4 | may be submitted to the department to temporarily delay the |
5 | expiration of the exemptions, deductions, abatements and credits |
6 | for the zone until June 30, 2009. The application must be |
7 | submitted by November 30, 2008, and include all ordinances, |
8 | resolutions or other required action from all affected political |
9 | subdivisions approving the requested delay in the expiration of |
10 | the keystone opportunity zone. The department shall certify the |
11 | delay in the expiration by December 31, 2008. If the expiration |
12 | of a keystone opportunity zone is delayed under this subsection, |
13 | a political subdivision or its designee may apply for an |
14 | extension pursuant to subsection (c), provided that the |
15 | application shall be submitted by May 1, 2009, and approved by |
16 | the department no later than June 30, 2009. If an extension is |
17 | granted under subsection (c), the extension shall be deemed to |
18 | be effective January 1, 2009. |
19 | (e) Expiration.--All extensions of an unoccupied parcel |
20 | certified under subsection (a)(1)(i) shall expire no later than |
21 | seven years following the expiration date of the existing |
22 | keystone opportunity zone, keystone opportunity expansion zone |
23 | or keystone opportunity improvement zone. All extensions of an |
24 | unoccupied parcel certified under subsection (a)(1)(ii) shall |
25 | expire no later than ten years following the date of occupancy |
26 | of the unoccupied parcel. All extensions of tax benefits under |
27 | subsection (a)(1)(iii) for a zone that expires on January 1, |
28 | 2013, shall expire no later than ten years following the |
29 | approval of the extension of the existing keystone opportunity |
30 | zone, keystone opportunity expansion zone or keystone |
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1 | opportunity improvement zone or subzone. An extension of tax |
2 | benefits under subsection (a)(1)(iii) shall expire no sooner |
3 | than seven years but no later than ten years following approval |
4 | of the extension as determined by the department. |
5 | Section 301.4. Additional keystone opportunity expansion zones. |
6 | (a) Establishment.-- |
7 | (1) In addition to any designations under section 301.1, |
8 | the department may designate up to 15 additional keystone |
9 | opportunity expansion zones in accordance with this section. |
10 | Each additional keystone opportunity expansion zone shall: |
11 | (i) Not be less than ten acres in size, unless |
12 | contiguous to an existing zone. |
13 | (ii) Not exceed, in the aggregate, a total of 350 |
14 | acres. |
15 | (iii) Be comprised of parcels that meet any of the |
16 | following criteria: |
17 | (A) Are deteriorated, underutilized or |
18 | unoccupied on the effective date of this clause. |
19 | (B) Are occupied by a business that: |
20 | (I) Creates or retains at least 1,400 full- |
21 | time jobs in this Commonwealth within three years |
22 | of the designation of the keystone opportunity |
23 | expansion zone; and |
24 | (II) Makes a capital investment of at least |
25 | $750,000,000 in the additional keystone |
26 | opportunity enhancement zone within three years |
27 | of the designation of the keystone opportunity |
28 | expansion zone. |
29 | (2) [The department shall immediately notify political |
30 | subdivisions located within the area designated.] In addition |
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1 | to any designations under section 301.1 and paragraph (1), |
2 | the department may designate up to 15 additional keystone |
3 | opportunity expansion zones in accordance with this |
4 | subsection. Each additional keystone opportunity expansion |
5 | zone shall: |
6 | (i) Not be less than ten acres in size unless |
7 | contiguous to an existing zone. |
8 | (ii) Not exceed, in the aggregate, a total of 350 |
9 | acres. |
10 | (iii) Be comprised of parcels that meet any of the |
11 | following criteria: |
12 | (A) Are deteriorated, underutilized or |
13 | unoccupied on the effective date of this clause. |
14 | (B) Are occupied by a business that: |
15 | (I) creates or retains at least 1,000 full- |
16 | time jobs in this Commonwealth within three years |
17 | of the designation of the keystone opportunity |
18 | zone; and |
19 | (II) makes a capital investment of at least |
20 | $500,000,000 in the additional keystone |
21 | opportunity expansion zone within three years of |
22 | the designation of the keystone opportunity |
23 | expansion zone. |
24 | (3) If a business in a keystone opportunity expansion |
25 | zone designated under paragraph (2) makes an investment of at |
26 | least $1,000,000,000 and creates at least 400 new permanent |
27 | full-time jobs within seven years of the date of designation |
28 | by the department, the department shall grant exemptions, |
29 | deductions, abatements and credits under this act for a |
30 | period of 15 years from the date of occupancy. If the |
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1 | business fails to comply with the provisions of this |
2 | paragraph, the period of the zone shall revert to ten years. |
3 | (b) Authorization.--Persons and businesses within an |
4 | additional keystone opportunity expansion zone authorized under |
5 | subsection [(a)] (a)(1) or (2) shall be entitled to all tax |
6 | exemptions, deductions, abatements or credits set forth under |
7 | this act, except exemptions for sales and use tax under section |
8 | 511(a) or 705(a), for a period of ten years, beginning on |
9 | January 1, 2010, and ending on December 31, 2020. For a keystone |
10 | opportunity expansion zone established under subsection (a)(1), |
11 | the ten-year period shall begin on January 1, 2010, and end on |
12 | December 31, 2019. For a keystone opportunity expansion zone |
13 | established under subsection (a)(2), the ten-year period shall |
14 | begin on January 1, 2013, and end on December 31, 2022. |
15 | Exemptions for sales and use taxes under sections 511 and 705 |
16 | shall commence upon designation of the zone by the department. |
17 | (c) Application.--In order to receive a designation under |
18 | subsection [(a)] (a)(1), the department must receive an |
19 | application from a political subdivision or its designee no |
20 | later than May 1, 2009, and no later than October 1, 2013, for a |
21 | keystone opportunity expansion zone established under subsection |
22 | (a)(2). The application must contain the information required |
23 | under section 302(a)(1), (2)(i) and (ix) and (6). The |
24 | application must include all ordinances, resolutions or other |
25 | required action adopted by all political subdivisions in which |
26 | the keystone opportunity expansion zone is located providing the |
27 | tax exemptions, deductions, abatements and credits authorized |
28 | under Chapter 7. The department, in consultation with the |
29 | Department of Revenue, shall review the application and, if |
30 | approved, issue a certification of all tax exemptions, |
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1 | deductions, abatements or credits under this [part] act for the |
2 | additional keystone opportunity expansion zone within three |
3 | months of receipt of the application. The department shall act |
4 | on an application under this subsection by June 30, 2009. |
5 | (d) Unused keystone opportunity expansion zones.-- |
6 | (1) The department may designate any of the 15 remaining |
7 | keystone opportunity expansion zones established under |
8 | subsection (a) for which there was no designation by the |
9 | department as of the effective date of this subsection. To |
10 | receive a designation of a remaining keystone opportunity |
11 | expansion zone under this subsection, the department must |
12 | receive an application from a political subdivision or its |
13 | designee by June 1, 2012. The application must comply with |
14 | subsection (c) except for the application deadline. The |
15 | department, in consultation with the Department of Revenue, |
16 | shall review the application and, if approved, shall issue a |
17 | certification of all tax exemptions, deductions, abatements |
18 | or credits under this act for the additional keystone |
19 | opportunity expansion zone within three months of receipt of |
20 | the application. |
21 | (2) Persons and businesses within an additional keystone |
22 | opportunity expansion zone authorized under paragraph (1) |
23 | shall be entitled to all tax exemptions, deductions, |
24 | abatements or credits set forth under this act, except |
25 | exemptions for sales and use tax under section 511(a) or |
26 | 705(a), for a period of ten years beginning January 1, 2013, |
27 | and ending December 31, 2022. Exemptions for sales and use |
28 | taxes under sections 511 and 705 shall commence upon |
29 | designation of the zone by the department. |
30 | (e) Notice.--Upon designation under this section, the |
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1 | department shall immediately notify political subdivisions |
2 | located within the area designated. |
3 | Section 2. The act is amended by adding a section to read: |
4 | Section 301.7. Expansion for new job creation. |
5 | (a) Expansion.--The department may approve an application to |
6 | expand the area of a keystone opportunity zone, keystone |
7 | opportunity expansion zone or keystone opportunity improvement |
8 | zone or subzone to include additional parcels that are |
9 | deteriorated, underutilized or unoccupied on the effective date |
10 | of this section and which are contiguous to the existing zone |
11 | not to exceed 15 acres. All exemptions, deductions, abatements |
12 | and credits under this act shall be extended to the new parcels |
13 | for a period of ten years following approval of the expansion of |
14 | the keystone opportunity zone, keystone opportunity expansion |
15 | zone or keystone opportunity improvement zone. |
16 | (b) Application.--The following shall apply: |
17 | (1) In order to extend the tax exemptions, deductions, |
18 | abatements and credits under this act to additional parcels |
19 | under subsection (a), the department must receive an |
20 | application from a political subdivision or its designee by |
21 | October 1, 2012. |
22 | (2) The application under paragraph (1) must: |
23 | (i) Contain the information required under section |
24 | 302(a)(1), (2), (3), (5) and (6). |
25 | (ii) Include all ordinances, resolutions or other |
26 | required action adopted by all political subdivisions in |
27 | which the unoccupied, deteriorated or underutilized |
28 | parcel is located adopting the expansion of the zone and |
29 | the extension of all tax exemptions, deductions, |
30 | abatements and credits authorized under Chapter 7. |
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1 | (3) The department, in consultation with the Department |
2 | of Revenue, shall review the application and, if approved, |
3 | issue a certification of all tax exemptions, deductions, |
4 | abatements or credits under this chapter for the unoccupied |
5 | parcel within three months of receipt of the application. |
6 | (4) The certification under paragraph (3) shall be |
7 | effective ten days following designation of the expansion by |
8 | the department. |
9 | (c) Expiration.--All expansions of an unoccupied parcel |
10 | certified under subsection (b) shall expire no later than ten |
11 | years following the effective date of certification by the |
12 | department. |
13 | Section 2.1. Section 302(b) of the act, amended December 9, | <-- |
14 | 2002 (P.L.1727, No.217), is amended to read: |
15 | Section 302. Application. |
16 | * * * |
17 | (b) Participation limitation.--A political subdivision shall |
18 | not be a part of more than one proposed keystone opportunity |
19 | zone or proposed keystone opportunity expansion zone, unless the |
20 | department agrees that two zones will bring additional economic |
21 | benefit to the political subdivision. A proposed expansion |
22 | subzone may not overlap the boundaries of a subzone. |
23 | * * * |
24 | Section 3. Sections 515(g) and 516(f) of the act, amended |
25 | December 9, 2002 (P.L.1727, No.217), are amended to read: |
26 | Section 515. Corporate net income tax. |
27 | * * * |
28 | (g) Section not applicable to certain businesses.--[Any |
29 | portion of the taxpayer's taxable income that is attributable to |
30 | the operation of a railroad, truck, bus or airline company, |
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1 | pipeline or natural gas company, water transportation company, a |
2 | corporation that qualifies as a regulated investment company |
3 | under Article IV of the Tax Reform Code of 1971 or holding |
4 | company as defined in Article VI of the Tax Reform Code of 1971 |
5 | shall not be used to calculate a credit under this section.] The |
6 | following shall apply: |
7 | (1) Any portion of the taxpayer's taxable income that is |
8 | attributable to the operation of any of the following may not |
9 | be used to calculate a credit under this section: |
10 | (i) Any of the following that are required to use |
11 | special apportionment under Article IV of the Tax Reform |
12 | Code of 1971 or would be required to use special |
13 | apportionment under Article IV of the Tax Reform Code of |
14 | 1971 if the taxpayer had income from business activity |
15 | taxable both within and without this Commonwealth: |
16 | (A) A railroad, truck, bus or airline company. |
17 | (B) A pipeline or natural gas company. |
18 | (C) A water transportation company. |
19 | (ii) A corporation that qualifies as a regulated |
20 | investment company under Article IV of the Tax Reform |
21 | Code of 1971. |
22 | (iii) A holding company as defined in Article VI of |
23 | the Tax Reform Code of 1971. |
24 | (2) The prohibition under paragraph (1) shall not apply |
25 | to the portion of a qualified business engaged in |
26 | manufacturing or processing. |
27 | Section 516. Capital stock franchise tax. |
28 | * * * |
29 | (f) Credit not available.--[Any portion of the taxpayer's |
30 | tax liability that is attributable to the capital employed in |
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1 | the operation of a railroad, truck, bus or airline company, |
2 | pipeline or natural gas company, water transportation company, a |
3 | corporation that qualifies as a regulated investment company |
4 | under Article IV of the Tax Reform Code of 1971 or holding |
5 | company as defined in Article VI of the Tax Reform Code of 1971 |
6 | shall not be used to calculate a credit under this section.] The |
7 | following shall apply: |
8 | (1) Any portion of the taxpayer's tax liability that is |
9 | attributable to the capital employed in the operation of any |
10 | of the following may not be used to calculate a credit under |
11 | this section: |
12 | (i) Any of the following that are required to use |
13 | special apportionment under Article IV of the Tax Reform |
14 | Code of 1971 or would be required to use special |
15 | apportionment under Article IV of the Tax Reform Code of |
16 | 1971 if the taxpayer had income from business activity |
17 | taxable both within and without this Commonwealth: |
18 | (A) A railroad, truck, bus or airline company. |
19 | (B) A pipeline or natural gas company. |
20 | (C) A water transportation company. |
21 | (ii) A corporation that qualifies as a regulated |
22 | investment company under Article IV of the Tax Reform |
23 | Code of 1971. |
24 | (iii) A holding company as defined in Article VI of |
25 | the Tax Reform Code of 1971. |
26 | (2) The prohibition under paragraph (1) shall not apply |
27 | to the portion of a qualified business engaged in |
28 | manufacturing or processing. |
29 | Section 4. Section 907 of the act, amended December 9, 2002 | <-- |
30 | (P.L.1727, No.217), is amended to read: |
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1 | Section 907. Application time. |
2 | [An] (a) Requirement.--Except as set forth in subsection |
3 | (b), an applicant must file an application in a manner |
4 | prescribed by the department by December 31 of each calendar |
5 | year for which the applicant claims any exemption, deduction, |
6 | abatement or credit under this act. |
7 | (b) Extension or waiver.--Upon request of the applicant, the |
8 | department may extend or waive the application deadline for good |
9 | cause shown if the political subdivision does not object to the |
10 | waiver or extension. |
11 | (c) Approval.--No exemption, deduction, abatement or credit |
12 | may be claimed or received for that calendar year until approval |
13 | has been granted by the department. |
14 | Section 5. The act is amended by adding a section to read: |
15 | Section 1104. Monitoring data. |
16 | In addition to any other requirements of this act, the |
17 | department shall monitor all of the following: |
18 | (1) Verifiable job creation and job retention data. |
19 | (2) Information on the types of jobs created and average |
20 | hourly wages. |
21 | (3) Number of years in the program. |
22 | (4) Annual, unduplicated public and private capital |
23 | investment amounts. |
24 | (5) Business type and description. |
25 | (6) Types and amounts of other economic development |
26 | assistance received from the department. |
27 | (7) Documentation that proper participants identified as |
28 | relocations meet the increased full-time employment, |
29 | increased capital investment or lease agreement requirements |
30 | of this act. |
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1 | Section 6. The amendment of section 907 of the act shall |
2 | apply retroactively to January 1, 2009. |
3 | Section 4 7. This act shall take effect immediately. | <-- |
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